SEVERANCE PAY POLICY (HR2423).PDF

Maricopa County Internal Policy Number: HR2423
Policy Title: Severance Pay for Release Issue Date: November 2003
of Claims
Policy Category: Human Initiating Department: Workforce Revision: 1
Resources Management. and Development
Reviewed by: Revision Date: December
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I. PURPOSE
The purpose of this policy is to provide the framework and process for the discretionary payment of
Severance for Release of Claims (Severance) to a classified or unclassified employee in exchange for a
release of all claims signed by that employee. At the discretion of the County Manager, Severance may
be offered and paid as provided under the following circumstances: (1) to employees affected by an
involuntary Reduction in Force (RIF); or (2) to a County employee separating from County employment
in circumstances where the County Manager determines it is necessary and appropriate to obtain a full
release of claims against the County, including but not limited to its supervisors, administrators, trustees,
directors, agents, representatives, employees, departments and special districts. In involuntary RIF
situations, the Appointing Authority must include a written proposal for the payment of severance in the
RIF Justification Memorandum required by HR2403.
DEFINITIONS
A. Appointing Authority: An elected official, a single executive head of a department, or the
designated representative authorized to act in this capacity.
B. Director: The Director of Maricopa County's Workforce Management and Development
(WM&D) Department, or his/her designee.
C. Maricopa County: For purposes of a Severance Agreement authorized pursuant to this policy,
this includes but is not limited to, Maricopa County, a political subdivision of the State of Arizona,
and its past, present and future supervisors, administrators, trustees, directors, officers, agents,
employees, employee benefit programs (and the trustees, administrators, fiduciaries and
insurers of such programs), departments and special districts, and all other persons acting by,
through, under or in concert with any of the persons or entities listed herein and their
successors.
D. Reduction in Force (RIF): The involuntary separation of a regular employee from classified
service, or of an unclassified employee due to one of the following reasons: lack of funds, lack
of work, or abolishment of position, as described in HR2403.
E. Release of Claims: A binding commitment given by a classified or unclassified employee in
exchange for payments and consideration described in a Severance Agreement authorized
under this policy whereby the employee, as a free and voluntary act, agrees that the payments
and consideration made by the County are in full satisfaction of any and all claims (more fully
described in the Severance Agreement) that the employee may have against the County.
F. Severance and Release Agreement: An Agreement entered into between an employee and
Maricopa County in which the County agrees to make a severance payment and/or to provide a
tangible benefit to the employee in exchange for that employee's release of all claims, known or
unknown, which that employee may have had against the County through the employee's last
day of employment.
G. Severance: Payment by the County of a specific amount to an employee under the
circumstances and subject to the terms and conditions set forth in this policy.
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Maricopa County Internal Policy Number: HR2423
Policy Title: Severance Pay for Release Issue Date: November 2003
of Claims
Policy Category: Human Initiating Department: Workforce Revision: 1
Resources Mena. ernent and Develo tment
III AUTHORIZATION AND ELIGIBILITY
A. As approved by the Board on November 5, 2003, an offer of Severance may be authorized at
the discretion of the County Manager, under the terms and conditions described in this policy,
for any employee(s) separated from employment with Maricopa County.
1. Classified and unclassified employees, excluding initial probationary, temporary or
contract employees, may be eligible to receive Severance. Employees of the judicial
branch and employees covered by the Law Enforcement Officers Merit System Rules
are not eligible to receive Severance.
2. As provided in this policy, where the payment of Severance has been approved by the
County Manager, the employee's eligibility to receive Severance is contingent upon (1)
that employee's execution of a Severance and Release Agreement; and (2) upon
approval by the Maricopa County Board of Supervisors.
3. The County Manager may authorize that Severance be paid in installments or in a lump
sum.
4. Exceptions to this policy may occur with Board approval only.
B. Without exception, any Severance Agreement prepared pursuant to this policy must be
prepared and reviewed by legal counsel, as designated by the Director.
IV. PROCESS FOR SEVERANCE PAY AUTHORIZATION IN THE EVENT OF A RIF
A. When the Appointing Authority or designee determines that an involuntary Reduction in Force is
necessary, and that the payment of Severance (as defined in this policy) to affected employees
is appropriate, the Appointing Authority shall confer with the Director regarding the anticipated
Reduction in Force, in accordance with HR 2403, and shall submit a RIF Justification
Memorandum to the County Manager that includes a proposal for the payment of Severance.
B. Any employees to be affected by an anticipated RIF may become eligible for Severance.
However, it is not required that affected employees in a department undergoing a RIF be offered
Severance.
C. The Appointing Authority's severance proposal must reflect the approval of the Deputy County
Manager, or the department's Assistant County Manager or elected official at the time the RIF
Justification Memorandum is submitted to the County Manager. The severance proposal must
include:
1. the reason for offering Severance;
2. the total amount of Severance to be offered to each employee, including payment of
COBRA continuation premiums, if applicable;
3. the basis upon which the amount of individual Severance is calculated (e.g., years of
County service, etc.);
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Maricopa County Internal Policy Number: KR2423
Policy Title: Severance Pay for Release Issue Date: November 2003
of Claims
Policy Category: Human Initiating Department: Workforce Revision: 1
Resources Manes ement and Development
4. the cumulative amount to be paid as Severance, assuming that every affected employee
signs the agreement;
5. the anticipated date of the Reduction in Force; and
6. a list stating the name of each employee to be offered Severance and that employee's:
market range job title; working title; budgeted pay rate; work unit; position control
number; hire date; and the total amount to be paid to the employee.
D. Severance proposals in RIF situations must be verified for funding with the Office of
Management & Budget, prior to being submitted to the Director and the County Manager.
E. In those cases where the County Manager or elected official approves the payment of
Severance to employees affected by a RIF, the Appointing Authority will provide the County's
Payroll division with the list of employees approved to receive Severance, and the amounts to be
paid to each employee, contingent upon execution of the agreements.
V. REQUIREMENTS FOR SEVERANCE IN NON-RIF SITUATIONS
In those cases where the County Manager has determined it is necessary and appropriate to pay
Severance to an employee separating from County employment in a non-RIF situation, under the
circumstances defined in this policy, and where the employee has executed the Severance Agreement,
approval of the agreement will then be obtained from the Director and the Civil Division, and then
submitted for approval to the Board of Supervisors.
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